Appraisals Dip Below Homeowner Estimates For First Time in 17 Months

Appraiser opinions of home values fell below homeowner estimates by 0.13 percent in February for the first time since August 2013 according to Quicken Loans’ Home Price Perception Index (HPPI), which measures the difference between what owners think their homes should be worth and what appraisers decide they actually are worth.

Despite the drop in the national HPPI, appraiser opinions remain higher than homeowner estimates in 18 of the 27 metro areas analyzed by the HPPI. Two cities of note are Baltimore and Atlanta, both of which moved from a positive to negative HPPI values - meaning appraisers now have a lower opinion of value than homeowners in these cities, dragging down the national average.

“While it’s significant that appraiser opinions are now lower than homeowners’ nationally, this minimal difference is unlikely to derail a refinance or cause headaches for the homeowner,” said Bob Walters, Quicken Loans Chief Economist. “The dip in the HPPI is likely caused by a delay of homeowner perceptions. As the economy recovered, homeowners hadn’t realized property values had improved. With the headlines of growing home prices, homeowners are catching up, but are now a bit overzealous in their estimates.”

Appraiser opinions of values remained higher than homeowner estimates in 18 of the 27 metro areas measured. Values rose enough in the Western Region to push the total national average higher than in January.   In January appraiser opinions were 0.18 percent higher than homeowners’.

The Quicken Loans Home Value Index (HVI), also released today, showed home values continued at a healthy pace. Nationally, values increased 1 percent from January to February, and grew 8.45 percent from the year prior.

Home Value Index (HVI)

February’s measure of home values followed the trend set in January, showing steady, healthy growth. Nationwide, home values increased 1 percent from January to February and increased 8.45 percent over the previous February. The West Region doubled the growth of the national average with a 2.46 percent home value increase since January. Home values in the South, Northeast and Midwest Regions were nearly flat with an increase of 0.35 percent and drops of 0.16 and 0.40 percent, respectively.

“The Western Region continues to glow red hot, while home values in the rest of the country remain frozen,” continued Walters. “The spring home buying season may be a big market mover, depending on the inventory that is available. Bidding wars from a tight market could cause prices to jump, or we could see more gradual growth in a more balanced market.”

	HVI February 2015 January 2005 = 100	HVI February 2015 vs. January 2015 % Change	HVI February 2015 vs. February 2014 % Change	HPPI February 2015 Appraiser Value vs. Homeowner Perception of Value*	HPPI February 2014 Appraiser Value vs. Homeowner Perception of Value*
National Composite	93.34	+1.00%	+8.46%	-0.13%	2.11%
*A positive value represents appraiser opinions that are higher than homeowner perceptions. A negative value represents appraiser opinions that are lower than homeowner perceptions.

 

 

Geographic Regions	HVI February 2015 January 2005 = 100	HVI February 2015 vs. January 2015 % Change	HVI February 2015 vs. February 2014 % Change	HPPI February 2015 Appraiser Value vs. Homeowner Perception of Value*	HPPI February 2014 Appraiser Value vs. Homeowner Perception of Value*
West	109.12	+2.46%	+10.01%	0.32%	5.86%
South	95.23	+0.35%	+7.65%	-0.15%	2.58%
Northeast	93.4	-0.16%	+5.17%	-0.35%	-1.57%
Midwest	78.94	-0.40%	+7.68%	-0.37%	-0.13%
*A positive value represents appraiser opinions that are higher than homeowner perceptions. A negative value represents appraiser opinions that are lower than homeowner perceptions.

 

 

Metropolitan Areas	HPPI February 2015 Appraiser Value vs. Homeowner Perception of Value*	HPPI January 2015 Appraiser Value vs. Homeowner Perception of Value*	HPPI February 2014 Appraiser Value vs. Homeowner Perception of Value*
San Jose	+6.63%	+6.42%	+5.83%
San Francisco	+4.78%	+4.59%	+6.50%
Denver	+4.12%	+3.97%	+4.95%
Dallas	+4.09%	+4.10%	+4.15%
Houston	+3.30%	+3.42%	+3.46%
Portland	+3.27%	+3.54%	+2.22%
Los Angeles	+3.09%	+3.28%	+6.04%
Seattle	+2.87%	+2.92%	+3.78%
Sacramento	+2.76%	+2.99%	+9.27%
Boston	+2.09%	+2.11%	+0.39%
Detroit	+2.04%	+2.36%	+4.57%
Washington DC	+1.66%	+1.60%	+2.42%
Las Vegas	+1.47%	+1.77%	+5.89%
Miami	+1.22%	+1.28%	+5.21%
Phoenix	+1.22%	+1.75%	+5.04%
Minneapolis	+1.20%	+1.53%	+2.82%
Riverside, CA	+1.15%	+0.82%	+7.59%
San Diego	+0.10%	+0.31%	+6.95%
Tampa	-0.01%	-0.24%	+2.85%
Baltimore	-0.16%	+0.12%	-2.00%
Atlanta	-0.24%	+0.19%	+1.33%
Chicago	-0.52%	-0.38%	-1.65%
New York	-0.86%	-0.83%	-1.44%
Cleveland	-0.93%	-0.97%	-1.54%
Philadelphia	-1.65%	-1.59%	-3.69%
Charlotte	-1.77%	-1.62%	+0.84%
Kansas City	-3.39%	-3.73%	-1.46%
*A positive value represents appraiser opinions that are higher than homeowner perceptions. A negative value represents appraiser opinions that are lower than homeowner perceptions.